USD/CAD Price Analysis: Corrects from three-month highs near 1.2850
- USD/CAD faces rejection once again near 1.2850 amid firmer WTI prices.
- The major has room to rise further amid a bullish breakout and firmer RSI.
- The immediate downside could find some support at the 1.2790 price zone.
USD/CAD is extending its corrective pullback from three-month highs of 1.2846, now attacking the 1.2800 level amid a rebound in oil prices.
The pair fails to benefit from the resurgent US dollar demand across the board, as WTI rebounds over 2% so far this Monday.
Meanwhile, investors move past the mixed US and Canadian employment data, as they await the Bank of Canada (BOC) rate decision due to be announced on Wednesday.
Looking at USD/CAD’s daily chart, the bears have fought back control, as the price now looks to test the critical trendline resistance now support at 1.2791.
Despite the pullback, the bullish potential remains intact after the pair witnessed an upside breakout from the three-month-long falling trendline support last Thursday.
The 14-day Relative Strength Index (RSI) is sitting just beneath the overbought territory, allowing more room for the upside.
Bulls will need to cross the multi-month highs to take on the September highs at 1.2896.
USD/CAD: Daily chart
On the downside, a firm break below the abovementioned strong support at 1.2791 could accentuate the correction towards Friday’s low of 1.2744.
The next bearish target is envisioned at 1.2700 if the selling pressure accelerates.
USD/CAD: Additional levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
